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(Reuters) - Fiat (FIA.MI) and its U.S. unit Chrysler expect to roll out at least 100,000 Jeeps in China when production starts in 2014 as they seek to catch up with rivals in the world's biggest car market.

Chrysler, in which Fiat has a 58.5 percent stake, said on Tuesday it had agreed to make Jeeps in China with Guangzhou Automobile Group (601238.SS).

Fiat is trying to offset a slump in European sales by targeting fast growing markets in Asia and Latin America. The Italian firm and Chrysler lag far behind other foreign carmakers in China, where consumers bought 19.3 million cars last year.

"We expect production of around 100,000 Jeeps per year which is expandable to 200,000," Marchionne, who is also CEO of Chrysler, said on the sidelines of a conference, adding production could start in 18 months.

General Motors (GM.N) and Volkswagen (VOWG_p.DE) both sold more than 2.8 million cars in China last year, and together accounted for over 29 percent of total vehicle sales in China, according to IHS Global Insight.

Jeep, Chrysler and Fiat, by contrast, sold just over 60,000 cars in China in 2012.

Since Fiat helped rescue Chrysler from bankruptcy in 2009, the U.S. No.3 automaker has turned into the main profit driver for the combined group thanks to strong U.S. demand.

Marchionne said he expected a court decision on the pricing of an option it has exercised to buy a 3.3 percent stake held by a union healthcare trust in the U.S. carmaker in the first quarter.

Under Chrysler's bailout agreement Fiat is able to exercise call options to purchase portions of the 41.5 percent stake held by the VEBA healthcare trust.

However, the two have been locked in a courtroom battle after VEBA balked at the $139.7 million price tag Fiat offered to buy a 3.3 percent tranche of Chrysler shares last July, saying it was too low.

In January Fiat filed to buy another 3.3 percent tranche of Chrysler from the VEBA.

Asked about the outlook for the global car market this year, Marchionne said he did not expect any meaningful recovery in Europe, where demand for new cars fell to a 17-year low in 2012.

"In North America, in Latin America and in China sales will rise," he added.

At 1307 GMT Fiat shares were up 4 percent at 4.4 euros. The shares had risen before Marchionne's comments.